Saudi Aramco annual review reaffirms global energy role

The theme of the Saudi Aramco 2005 Annual Review is "Powering the planet, empowering lives."

The publication provides an overview of company operations for 2005, including crude oil and gas exploration, production, processing and transportation, and the company's burgeoning activities in petrochemicals, upstream gas joint ventures and other international and domestic activities.

The past year stands out as a remarkable one, as the company embarked on its largest crude oil production capacity-expansion plans in more than a quarter century. The review details the mega-projects — Haradh Increment III, Khurais, Shaybah, Nuayyim and Abu Hadriya, Fadhili and Khursaniyah — that, taken together, in less than five years will add the rough equivalent of the annual crude production of Norway or Venezuela.

Saudi Aramco maintained its position as the world leader in the petroleum industry in 2005, with a total of 3.3 billion barrels of crude oil produced and reserves of 259.8 billion barrels, one-fourth of the global total. Gas production for the year came to 2.87 trillion standard cubic feet, and NGL production grew to 400.4 million barrels.

The company's Master Gas System, the largest integrated gas-gathering, processing and distribution system of its kind in the world, is also expanding, with construction of the Hawiyah NGL Recovery Plant and the Khursaniyah Gas Plant and enlargement of the Hawiyah and Ju'aymah gas plants.

Other major projects, such as the expansion of the seawater treatment plant at Qurayyah and cogeneration facilities, are also described, as are developments in drilling and production technology.

No less sweeping in scope were the developments in international and domestic partnerships, such as the formation of the PetroRabigh joint venture with Sumitomo Chemical Co. and the work under way by the four upstream gas joint ventures, among others.

Increased energy demands

According to the U.S. Energy Information Administration's (EIA) International Energy Outlook 2005 (IOE2005), by 2025 world energy consumption is forecast to grow by nearly 60 percent, with fossil fuels remaining the dominant energy source.

A combination of factors, coupled with the sharp rise in demand, presented enormous challenges to the petroleum industry in 2005, including the staggering impact of Hurricanes Katrina and Rita on the petroleum sector. The Kingdom and Saudi Aramco rose to the occasion, as in the past, tapping spare capacity to reassure the world's economies. The company's ability to respond to demand by bringing additional capacity on-stream has been tested repeatedly over the last several years and, without exception, it has been able to bring the necessary additional barrels on-stream, helping to maintain market stability and fuel economic growth.

Ali I. Al-Naimi, Minister of Petroleum and Mineral Resources of the Kingdom of Saudi Arabia and chairman of the Saudi Aramco Board of Directors, comments in the annual review that "the true magnitude of Saudi Aramco's endeavors during the past year will become apparent only in time, given the many mega-projects currently under way throughout the company.

"These include massive oil and gas exploration and production programs, bold initiatives in the refining and petrochemical sectors, and major undertakings in critical technical, research and operational support functions. Although many of the seeds sown in 2005 will bear fruit only in years to come, I am certain they will provide a rich harvest for the future."

Abdallah S. Jum'ah, Saudi Aramco President & CEO, notes in the publication that Saudi Aramco's unmatched record for reliability is due to a variety of factors - including advanced infrastructure and cutting-edge technology - but it is the diverse company workforce that is the key. Though 87 percent of the workforce is Saudi, Jum'ah says that "What unites them is a distinct sense of being part of a very special company, the knowledge they are contributing to the well-being of the Kingdom and its people, and the understanding that the work they do is vital to the prosperity of countries and communities around the globe."